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Spotify is apparently running efficient with their business. They're saying that instead of an IPO they're looking to do a direct listing when they go public. Seems they are cash flow positive and do not need to raise any more money. That's actually pretty impressive.

Next step, getting enough users on board to be able to raise royalty rates without killing the company.

Jody, you apparently are getting much different information than I am. I have seen a lot of news that they are broke and having to do an IPO. I was told recently that they are not expected to be around another year. As usual, I defer to your information on technical stuff. But I would not be surprised to find all of this a ponzi scheme and one day like "Madoff" there are going to be some executives retiring to some non-extradition country and a lot of people holding worthless stock.

With most of the Internet services, I feel like I'm watching Enron and Bernie Madoff all over again. All these news reports and their executives talking about how great they are all doing, how positive their cash flow is, and that it is rainbows and lollipops forever on the horizon. And then one day it all implodes. The single biggest problem all these things have is that the majority of music streaming is FREE, and people are going to continue to get it for free, no matter how many walls and laws are written.

In the "insides" of offices around here, you hear the whisperings that all is not good in Internet land. I could be very wrong, and Jody could be right. Only time will tell. But I will say that almost every friend of mine who have had hit songs, tons of streams, get checks from Spotify and Pandora that almost don't cover the cost of the check. Where the money is going, I have no idea, but I think it is all built on sinking sand.

I don't know and I admit that I don't know. But the article John offered here is more of what I see, (John that was actually the article I saw last week but couldn't find) a LOT of money paid out for these companies and then they get to a part where they can't justify all that expense and they fold. And usually when that happens, look for the owners to go some place where their shareholders can't find them.

Aw,well, Heck yeah. "Just put a Bill on my Desk and I will sign it" Just post you songs and wait for the money to roll in. Well I did buy some new, "Old Music" CD's. You can see what I bought on Heaven's Radio, Barry's post about halfway down the page. My former Publisher once got a Check from BMI for a whopping 3 cents. I think he said he was going to Frame It! Heck I may actually have some money at BMI from some songs my Publisher sent overseas to Radio Programmers. Probably enough to buy me a Rolls Royce but who's counting! Write a Hit!

With most of the Internet services, I feel like I'm watching Enron and Bernie Madoff all over again. All these news reports and their executives talking about how great they are all doing, how positive their cash flow is, and that it is rainbows and lollipops forever on the horizon. And then one day it all implodes. The single biggest problem all these things have is that the majority of music streaming is FREE, and people are going to continue to get it for free, no matter how many walls and laws are written.

In the "insides" of offices around here, you hear the whisperings that all is not good in Internet land. I could be very wrong, and Jody could be right. Only time will tell. But I will say that almost every friend of mine who have had hit songs, tons of streams, get checks from Spotify and Pandora that almost don't cover the cost of the check. Where the money is going, I have no idea, but I think it is all built on sinking sand.

I don't know and I admit that I don't know. But the article John offered here is more of what I see, (John that was actually the article I saw last week but couldn't find) a LOT of money paid out for these companies and then they get to a part where they can't justify all that expense and they fold. And usually when that happens, look for the owners to go some place where their shareholders can't find them.

MAB

All looks true to me Marc.

On the other hand, I stay baffled that the total worth of some social media stocks can be in the multi-millions and billions, while the company has never earned a profit. I gave up trying to understand that.

Through in my life, I've never seen an economic phenomena that was not ultimately governed by common sensical "fundamentals," regardless of how obscure they seemed at points in the process.

Along those lines....Trump was talking about a stock market bubble during the campaign. Now that he is in and the bubble has further enlarged...what was a bubble seems to be a sign of "good times" and Trump's prowess. We'll see how it all turns out...I guess?.

I wish you tons of success from Spotify Streaming... but I'm hearing nothing encouraging about that process. The internet is becoming a large sink-hole and this latest round of "hacks" is not only impacting government sites, hospitals, businesses (all over the world) but seems to be aimed primarily at Windows 10 operating systems. This morning, our Win 10 laptop sent us through a bunch of fake message (looked sorta like something from Microsoft but not as bright on the PC screen) drills that led us to believe it might restore our computer. Nothing but a "catch 22" death spiral that never leads you anywhere but back where you started, trying to boot you computer. No ransom attempts, just a mean-spirited ploy to show us how "powerful" some pea brained twidget in outer Mongolia (or lower Manhattan) can steal our machines and lock us out.

Sorry for the "off topic" post, Jody... but I wanted to see if anyone else is having the same problem. Right now, I'm using my Linux based machine to use "the net" and so far, I've heard of no "attacks" on this hodge podge of variable operating systems.

B-T-W... I never heard the final result of the previous administration's negotiations regarding relinquishing the U.S. control of the internet. Any news from any of you?

It said on the news last night that it was only affecting Windows older than 10 Dave. That's if all the Windows 10 updates were performed. May have changed since last night. I don't think any of us are safe. Reminds me of the TV show "Person of Interest".

Theoretically, my Windows 10 updates are regularly performed whether I like it or not. I make it a habit to turn off my computer(s) when they are not being used... especially regarding the internet. Sometimes, I'll return to my Win 10 computer, knowing full-well that I turned it "off"... and one of the lights on the front will be blinking. I open it up, turn it on and observe Windows 10 in the process of "updating" my system. Pretty creepy knowing they can access my system even if it is in the "off state."

You may remember I reported in a post several months ago (sorry can't remember exact month) that Microsoft had invaded my Windows 7 machine and installed Windows 10 without even asking permission. Pretty Orwellian to my way of thinking. At that point, I took an old PC and scrubbed the hard drive to DOD standards, then installed Linux Mint. This is the unit I'm using to access JPF and the Web at this point in time. (My Windows 10 unit is still playing the blue screen game.) I hope our Government will take steps to find a way to make it impossible for "hackers" to meddle with the internet and computer systems. (I'm probably looking for assistance from the Fox who guards Chicken Coops... LOL!)

Perhaps we should all begin learning to use Morse Code, Semaphore Signalling and land line telephones again... like they used in WWII... and before. (Did you and friends or siblings ever connect a string or wire to two tin cans and stretch them 50 or so feet apart to attempt communication? Like we tried back in the day?)

We stopped doing anything on line including buying stuff from Amazon.IF there is a way to shut down Electricity we are all toast.The Lawyer and Wall Street Broker will be crap and the Fisherman, Farmer, Builder and hunter will be king....

ALSO IF they can screw up Banks and Wall Street and wipe out all the records WHAT Will happen then? It's scary and hilarious at the same time.

We are going to hang ourselves with our own rope....Maybe we all deserve it.

We stopped doing anything on line including buying stuff from Amazon.IF there is a way to shut down Electricity we are all toast.The Lawyer and Wall Street Broker will be crap and the Fisherman, Farmer, Builder and hunter will be king....

ALSO IF they can screw up Banks and Wall Street and wipe out all the records WHAT Will happen then? It's scary and hilarious at the same time.

We are going to hang ourselves with our own rope....Maybe we all deserve it.

Don't share quite this dim of an outlook Barry. I think the capacity is there to build society back from a solar storm or a severe infrastructure hacking. There's a lot of backup these days. For the fisherman to be king, I think, would take widespread devastation of hardware systems....such as caused by bombings.

Like Martin, I am also insignificant in the overall scheme of things... but I really don't like annoying stuff going on with my computer. Who knows the final resolution to this problem but it is a problem if the many "on-line" Banks and Businesses (like Amazon and others) don't find a way to harden the servers and cloud services they use for internet commerce.

If all else fails, I can actually live without the "net." (Another form of relatively inexpensive entertainment.)

EMP: electromagnetic pulse. Detonating an atomic bomb over our atmosphere would do the job (At North Korea's delight). It would take us back to the pre-electricity good-old-days. Anything electric (including the computers in our cars) would be non-functional (maybe for years). Read “One Second After” by William R. Forstchen. A fictional novel, but based on scientific knowledge. It would be hell on Earth.

EMP: electromagnetic pulse. Detonating an atomic bomb over our atmosphere would do the job (At North Korea's delight). It would take us back to the pre-electricity good-old-days. Anything electric (including the computers in our cars) would be non-functional (maybe for years). Read “One Second After” by William R. Forstchen. A fictional novel, but based on scientific knowledge. It would be hell on Earth.

John

Not sure John.

There were two bombs detonated over Japan without a world-reaching effect. I know that the bombs are bigger and badder these days...but in the final showdown, I don't think that "elvis" will want to risk blowing up the ride that he got for free. If he ever does anything like that, you won't even be able to find the molecules that were once him.

There were two bombs detonated over Japan without a world-reaching effect. I know that the bombs are bigger and badder these days...but in the final showdown, I don't think that "elvis" will want to risk blowing up the ride that he got for free. If he ever does anything like that, you won't even be able to find the molecules that were once him.

Google..."where are America's atomic submarines right now".

Those bombs on Japan were dropped from planes. I believe they were land detonated, not detonated above our atmosphere.

Jody, you apparently are getting much different information than I am. I have seen a lot of news that they are broke and having to do an IPO. I was told recently that they are not expected to be around another year. As usual, I defer to your information on technical stuff. But I would not be surprised to find all of this a ponzi scheme and one day like "Madoff" there are going to be some executives retiring to some non-extradition country and a lot of people holding worthless stock.MAB

I don't know where you're getting your information Marc, so I can't comment on what you know. Also, I'm not gonna argue about the validity of Spotify, they are the biggest player in streaming music (I can't count YouTube in that because they're streaming music/video). They are damn close to being entirely profitable and being Cash Flow Positive is a really good sign. That's also with only 50 million premium subscribers. My call was (and still is that) it would take 100 million premium subscribers before the money really started flowing for the music creators.

The single biggest problem all these things have is that the majority of music streaming is FREE, and people are going to continue to get it for free, no matter how many walls and laws are written.

Marc please link to the proof that a majority of music streaming is free. Spotify has a premium tier, and their "free" tier is ad revenue supported - just like traditional radio. YouTube, same story. Apple Music, no free tier. Deezer, no free tier. Tidal, no free tier. Those are all the biggest names in streaming.

I guess I just don't have any proof. You are probably right. Everything is perfect, every one is rolling in money and all is right with the world. I tend to go a bit more on emperical evidence, when I don't know ONE songwriter, publisher or label that is really making any money. The vast majority of professionals have completely gotten out of the business, for any project that any one has to do has to have outside financing because it is so expensive, and every time I see these rosy projections from tech people, they are followed up by stories of how THOSE companies have billions of dollars rolling in but still are not making money. Just call me skeptical.

The "Freemium vs" Premium" are from industry blogs I've read that become so numerous I don't have the computer space to keep them any more. The last figures I saw were 60% free and 40% paid. That could be vastly out of date, pretty much like every thing on the Internet. But a central question is how many songs DO $4.99 a month and UNLIMITED DOWNLOADING pay for?

My sneaking suspicion is that when they get the 100 million subscribers you are talking about, they will suddenly have to have two hundred million subscribers because the goal posts keep shifting all the time. I look at a world where NOBODY seems to be happy about anything going on in it. Not just musically but overall. Music is just one of those areas.

It doesn't really matter to me personally. Internet and streaming is not where anything I do is. I'm not an artist or a writer expecting anything from that. I teach craft and process of writing and art of performance. But the people I deal with HAVE to be aware and deal with it. It is people like that I have my concerns for. People that have the dream, but unfortunately the dream for the most part no longer has anywhere to go.

In most of the ways I am very old fashioned and unfortunately out of date. I still believe in the song, the singer and a relationship to the audience. That is why I have always bought more into people like Brian's theory of building a smaller, loyal following one person at a time. Social media, downloading, streaming are now all a huge part of that. I don't have to really like it but there is certainly nothing I can do about it. It is what it is.

I see a world where getting anyone to pay attention to anything past the constant activity on their cell phone and whatever happens THIS MINUTE is the most difficult thing we have to overcome as writers and artists. (I admit this being me at times also, so I'm as guilty as anyone I point fingers at.) I actually thrive more on live audiences than anything on the net.

As always you may be exactly correct and I am 100% wrong, and I'm always happy to admit that. But I have to see some proof that any of this is working outside of just one thing gobbling up another thing, vast companies that supposedly are flush with cash and making everything in the world better. I'm sure that is out there. I just don't see it in the music business.

Jody, if you want to know what really sums up the entireity of my position, here is a friend of mine, hit songwriter Marty Dodson that kind of says it better than I would. I can't give you facts and figures of the Internet, numbers or profitability or even if it makes sense. To me it really doesn't, but like everyone, it is a world I have to deal with one way or another. But this is more or less my exact opinion on the Internet verses "REALTY" to me. We all have our own version of reality. This is Marty's, mine and most actually songwriters, artists and ENTERTAINERS out there trying to do this. It might explain a little better why I just don't see the Internet as the savior of the world like many do.

My understanding of it all is that you're both partly right. Spotify is currently doing well and musicians and songwriters are never going to prosper to levels they did in the past. Why would Spotify ever increase royalties? The numbers are set,if anything, they might decrease them the more powerful they get.

I guess I just don't have any proof. You are probably right. Everything is perfect, every one is rolling in money and all is right with the world. I tend to go a bit more on emperical evidence, when I don't know ONE songwriter, publisher or label that is really making any money. The vast majority of professionals have completely gotten out of the business, for any project that any one has to do has to have outside financing because it is so expensive, and every time I see these rosy projections from tech people, they are followed up by stories of how THOSE companies have billions of dollars rolling in but still are not making money. Just call me skeptical.

I never wrote that everything was perfect. All I was doing was showing where I got the information I had that Spotify isn't planning on doing an IPO, but rather a direct listing. That is actually pretty amazing considering all the doom and gloom talk. Its also a different direction than Spotify being in trouble. I was asking the same of you so I could expand my understanding.

Here's a fact about being a premium subscriber myself: I don't often download songs - I stream them. On rare occasions I download songs to my devices if I'm going to an area where I don't get cell service. One thing to note, the moment I quit paying for the premium service - any downloads I may have done, will no longer be available to me. But I do have access to the entire Spotify catalog while I'm paying for it. Also the going rate for all streaming services is $9.99. I'm sure some offer limited discounted rates, but $4.99 is not the norm.

In another round of humor, Jimmy Iovine has come out in an interview today saying that Apple Music would have 400 million users if they had a free tier - that's his opinion. Personally I think they'd have more than 20 million premium subscribers if their software actually worked as well as Spotify's. But that's my opinion.

As for Brian's viewpoint - it could very well become the future that the parity between "stars" and "unknowns" becomes so great that less people get into the industry. I don't see that as a bad thing. It still comes down to the same thing as what you wrote - its all about the song.

I guess I just don't have any proof. You are probably right. Everything is perfect, every one is rolling in money and all is right with the world. I tend to go a bit more on emperical evidence, when I don't know ONE songwriter, publisher or label that is really making any money. The vast majority of professionals have completely gotten out of the business, for any project that any one has to do has to have outside financing because it is so expensive, and every time I see these rosy projections from tech people, they are followed up by stories of how THOSE companies have billions of dollars rolling in but still are not making money. Just call me skeptical.

I never wrote that everything was perfect. All I was doing was showing where I got the information I had that Spotify isn't planning on doing an IPO, but rather a direct listing. That is actually pretty amazing considering all the doom and gloom talk. Its also a different direction than Spotify being in trouble. I was asking the same of you so I could expand my understanding.

Here's a fact about being a premium subscriber myself: I don't often download songs - I stream them. On rare occasions I download songs to my devices if I'm going to an area where I don't get cell service. One thing to note, the moment I quit paying for the premium service - any downloads I may have done, will no longer be available to me. But I do have access to the entire Spotify catalog while I'm paying for it. Also the going rate for all streaming services is $9.99. I'm sure some offer limited discounted rates, but $4.99 is not the norm.

In another round of humor, Jimmy Iovine has come out in an interview today saying that Apple Music would have 400 million users if they had a free tier - that's his opinion. Personally I think they'd have more than 20 million premium subscribers if their software actually worked as well as Spotify's. But that's my opinion.

As for Brian's viewpoint - it could very well become the future that the parity between "stars" and "unknowns" becomes so great that less people get into the industry. I don't see that as a bad thing. It still comes down to the same thing as what you wrote - its all about the song.

Jimmy Iovine... ack.

Spotify works just like Virgin Digital worked in the early 2000's. It's too bad for Branson that he gave up too soon. He had the music world by the balls but got extended on other business ventures and chose poorly. Virgin Digital worked as smoothly as Spotify back when download/streaming speeds were awful and music on a phone was impossible. The guys who figured out how to maximize playing music on phones are the same guys who worked for Jimmy Iovine back at Farm Club, then created Virgin Digital (as well as the music players that Google, Yahoo, AOL and most other online sites used back then) and then created players/compression for phones. They were way ahead of it all and JPF members were the first independent musicians on the web that were streamed to over a million listeners. Sadly back then there were no royalties even in existence to cover it all, but still it was a wonderful time and most people completely missed it. That is when I came out and said loudly that Subscription services would be the way we'd all hear and consume music going forward. But it took years before the "industry" would play ball and due to that they missed out on a living wage level royalties even for stars. They refused to move forward, instead worry about file sharing which was just growing pains while speeds improved and people played ball finally. Had they been a little more forward looking, instead of just worrying about the next quarter, the model would be far better for everyone on all sides and the format/technology would be light years ahead of where it is now.

Well, I used both and I am telling you it was amazing... it also had more info, message boards, AllMusic reviews and personnel info and bios. It was way ahead of it's time and had by far the largest collection of music back in those days because it was the first to have CDBaby income. We even had multiple members get airplay checks from that channel. The only music that was on it was directly from our awards entries. It was cool. Spotify sucks by comparison. Their search is a big part of the issue... Virgin had an advanced search algorithm WAY ahead of its time so it made it way easier to find stuff even with a typo.By comparison, I can type everything in exactly right and spotify won't find it, so often I got in a different way (song title.album name etc. instead of artist name and sure enough there it is, under the correct name which never came up. I found that dozens of times. I made all those playlists under the jpfawards name and it worked for a couple people to subscribe to me (I have the highest level account) but now it doesn't work... and there's no one to help fix it. I'd give their interface a 5 out of 10 at best.

Just for the record, my daily ASCAP Propaganda E-zine's first article stated that Spotify's payments have dwindled during the past year. Forgive me, I did not read the whole thing... just too busy with three new songs in the oven in various stages. Streaming may work for some of you and I've never tried it... but... being an old geezer from the 33 & 45 record days, I'd rather have something tangible in my hands, looking at the picture from the eyes of the consumer.

B-T-W... off topic again... I finally got my wife's laptop (Windows stinking 10) back working again after 300 attempts and a thousand cursewords.

No matter what I prefer, I wish Jody all the success in the world. It's tough trying to make a living in "The Biz" these days. I've enjoyed reading your posts.

...finally, John: The Hiroshima and Nagasaki A-Bombs were "Air Burst" weapons based on a pre-determined altitude. (Not that it matters!)

I know we are never going to settle the "modern music era" streaming, downloading, etc. And I have no clue on where it is going. But I do continue to see stuff like this and I post it only as one more piece of information. Everyone has to approach music in their own way, but they should be aware of things going on. I know my buddy Jody Whitesides is in better position to quote on these things that I, my end is in the creative, not business side, but this is the type of information, most in the industry get. Read and compile.

I know we are never going to settle the "modern music era" streaming, downloading, etc. And I have no clue on where it is going. But I do continue to see stuff like this and I post it only as one more piece of information. Everyone has to approach music in their own way, but they should be aware of things going on. I know my buddy Jody Whitesides is in better position to quote on these things that I, my end is in the creative, not business side, but this is the type of information, most in the industry get. Read and compile.

I'm not a fan of David Lowery. Especially when he won't answer simple questions about his own music and how its distributed.

That being typed, I will say this, I find it weird that this blog post is using information posted before the news link I linked to. David conveniently ignores a lot of the information in the news post he linked to. Such as - the cost of all the international expansion of the business and the increased personnel that requires. The immediate takeaway of that is - music being more global with greater ease. As for things like currency fluctuations and such, that's all crap being manipulated beyond our control and beyond Spotify's.

As I originally posted, Spotify is now past 140 million users and growing at a faster clip than any of their competitors.

Another thing mentioned in the linked analysis is that they become profitable at scale. Which means it takes more users on premium subscriptions to happen. The premium part of the service is actually profitable. Where they're experiencing the biggest loss is in the freemium ad supported area. That's where the catch 22 is. It takes the freemium service to help convert users to premium, but its a loss leader. Any other service that doesn't have a 'free' level is having a much harder time getting paid subscribers.

Why didn't artists ever go ballistic over their physical product being a loss leader. All those under priced CDs at places like Target, Walmart, Best Buy and other non-music stores were all coming out of the writer's/publisher's/artist's pockets too.

My guess is that in the not so distant future we will see Spotify follow suit on what Apple quietly did with Apple Music over the weekend, offer a yearly subscription at a slightly reduced price. They posted a $99 yearly fee. I'm betting Spotify will do the same shortly. Why? Its still way more profitable than the ad based version and it locks you in for a full year at a time.

Despite all of this, what I still find odd is how many writers, publishers and artists would all prefer the average consumer to only spend $15 to $25 a year on recorded music for the average 1.5 CDs/Vinyls they tend(ed) to buy. When subscriptions get average consumers to start spending $100 to $120 a year on recorded music.

Remember, this is a long game not a short game.

p.s. - my end is in the creative, but I keep my nose in the tech and the business sides because they affect everything.

p.p.s. - looks like I may be branching out into the innovator side as well. Have two new things I'm working on, one is a software thing for musicians, the other is a hardware thing for musicians. I've already got a working prototype of the of the hardware. Currently in the design phase of the software.

Spotify is apparently running efficient with their business. They're saying that instead of an IPO they're looking to do a direct listing when they go public. Seems they are cash flow positive and do not need to raise any more money. That's actually pretty impressive.

Next step, getting enough users on board to be able to raise royalty rates without killing the company.

So, apparently screwing artists and songwriters is profitable, after all.

"Why didn't artists ever go ballistic over their physical product being a loss leader. All those under priced CDs at places like Target, Walmart, Best Buy and other non-music stores were all coming out of the writer's/publisher's/artist's pockets too."

Jody, I know you might not realize this but they HAVE been complaining for nearly 30 years. There were 3/4 rates required to get cuts in the first place. There was fuzzy accounting math that came up short for songwriters. They complained continually. When the reduced rates on Wal Mart, Target and Best Buy, came out THEY COMPLAINED TOO. In file sharing and peer to peer and the beginning of all this they were complaining. NSAI started going to Congress every year since 1995 or 96. I went personally in 2006. They have been screaming the entire time because the "public announcements of all these companies, and the big "payouts" they supposedly are making are NOT MAKING IT TO THE SONGWRITERS.

It is the same thing as ENRON, Bernie Madoff and other "Iron Clad" money makers that have been over the years. They make tons of claims while at the same time claiming they don't have enough subscribers, (they still claim to be making no money) and the goal posts get shifted. All of you on that side seem to know something the writers don't know, that all these payouts are being made.

The writers actually INVOLVED with writing the songs, have not gotten those memos. But I am sure they will be glad to know the check is in the mail.

Again, it doesn't really matter to me, because that is not what I have ever expected moneytarily from the industry. But the only people that will ever make money at this are going to be the people with very strong CELEBRITY BRAND. Those that write the songs, deliver the songs and have dynamic fan base that translates into live performance and product endorsements.

If you can deliver a healthy brand presence, you will do fine. Beyond that I would't hold my breath for much.

"Why didn't artists ever go ballistic over their physical product being a loss leader. All those under priced CDs at places like Target, Walmart, Best Buy and other non-music stores were all coming out of the writer's/publisher's/artist's pockets too."

Jody, I know you might not realize this but they HAVE been complaining for nearly 30 years. There were 3/4 rates required to get cuts in the first place. There was fuzzy accounting math that came up short for songwriters. They complained continually. When the reduced rates on Wal Mart, Target and Best Buy, came out THEY COMPLAINED TOO. In file sharing and peer to peer and the beginning of all this they were complaining. NSAI started going to Congress every year since 1995 or 96. I went personally in 2006. They have been screaming the entire time because the "public announcements of all these companies, and the big "payouts" they supposedly are making are NOT MAKING IT TO THE SONGWRITERS.

It is the same thing as ENRON, Bernie Madoff and other "Iron Clad" money makers that have been over the years. They make tons of claims while at the same time claiming they don't have enough subscribers, (they still claim to be making no money) and the goal posts get shifted. All of you on that side seem to know something the writers don't know, that all these payouts are being made.

Never once have I heard artists/writers/publishers bitch about the loss leaders until it came to streaming. So its all perspective. That being written - I wrote a post here on JPF a little while back that explained the math of Spotify compared to the math of a traditional record deal based around selling plastic. In doing so, I showed how the percentages of streaming payouts are better than a record deal's payouts - from a percentage perspective. They're slightly better, not much, but slightly. I didn't even take into account all the breakage and ¾ stuff. If I add that in, the streaming percentages get even better compared to the old world. Again, I'm talking long term. You're talking short term.

As for the argument about the claim of not having enough subscribers and goal posts moving... As far as I know, and the number that I've been familiar with (the entire time I've been looking into Spotify) is 100 million PREMIUM subscribers, not 100 million users. With that being said - we're running around in circles. I'm posting information that the company is relaying and the rebuttals are coming from somewhere else outside the company. Spotify is cash flow positive - they aren't claiming to be making no money, but they're not profitable yet either. The goal is to get the ad supported area to profitability, or get enough premium users to cover that loss, which at 50+ million is coming close.

And yes, I do know payouts are happening. I get them every month (for the master right) and quarter (for my writing/publishing/mechanicals). I do have to stay on top of my PRO and look for the corresponding streams. It doesn't take more than an hour every quarter. Small price of time to pay in order to make sure I'm getting what I'm due. That's part of running a business in music.

"Why didn't artists ever go ballistic over their physical product being a loss leader. All those under priced CDs at places like Target, Walmart, Best Buy and other non-music stores were all coming out of the writer's/publisher's/artist's pockets too."

Jody, I know you might not realize this but they HAVE been complaining for nearly 30 years. There were 3/4 rates required to get cuts in the first place. There was fuzzy accounting math that came up short for songwriters. They complained continually. When the reduced rates on Wal Mart, Target and Best Buy, came out THEY COMPLAINED TOO. In file sharing and peer to peer and the beginning of all this they were complaining. NSAI started going to Congress every year since 1995 or 96. I went personally in 2006. They have been screaming the entire time because the "public announcements of all these companies, and the big "payouts" they supposedly are making are NOT MAKING IT TO THE SONGWRITERS.

It is the same thing as ENRON, Bernie Madoff and other "Iron Clad" money makers that have been over the years. They make tons of claims while at the same time claiming they don't have enough subscribers, (they still claim to be making no money) and the goal posts get shifted. All of you on that side seem to know something the writers don't know, that all these payouts are being made.

The writers actually INVOLVED with writing the songs, have not gotten those memos. But I am sure they will be glad to know the check is in the mail.

Again, it doesn't really matter to me, because that is not what I have ever expected moneytarily from the industry. But the only people that will ever make money at this are going to be the people with very strong CELEBRITY BRAND. Those that write the songs, deliver the songs and have dynamic fan base that translates into live performance and product endorsements.

If you can deliver a healthy brand presence, you will do fine. Beyond that I would't hold my breath for much.

MAB

This is all 100% correct. I was on the other side (working for Circuit City and Transworld going back to the early 90's when Best Buy started the CD loss leader strategy (which is part of how they crushed Circuit City who refused to sell CD's at a loss, even though we were telling them it was a big mistake because it drove so much traffic). I advocated Circuit City and Transworld (then the biggest CD seller at the time) to follow the same strategy when I was in management for both companies, but they wouldn't listen (especially Transworld who got crushed and helped bring down Incredible Universe which was an awesome company to work for and for customers and even for artists as we book live CD release concerts inside the mammoth 200K sq. feet super stores for major label artists which was a great two-way promotion for both the artists and the company. Best Buy was responsible for driving the prices down and the only ones who followed were (for the longest time) Wal-Mart, but that was YEARS later. Best Buy's corporate growth and dominance arose on the back of under cost CD sales. What i didn't know at the time was that the labels made deals with some of these companies and sold out their own artists and writers. It was all about payola in the form of Listening Stations which was like under the table money to these companies in exchange for pushing new artists and putting certain artists on the top of the charts. They did it by essentially giving away music under cost but back door making up for the losses with Listening Station monies which cut out the artists and writers from that massive income stream. So the losses incurred by selling under cost were covered by listening station payola. It was another way to manipulate radio charts, sales and which artists thrived or died. And of course not only did they not pay the artists/writers any of that money stream, but they billed the artists themselves for the cost of paying for the listening stations so it was all a scam in my opinion, one which I screamed about on the corporate side and realized how unfair it all was and how hopeless it really was for artists and writers. I exposed this all through the 90's on the weekly AOL JPF Music Industry chat I hosted throughout the early to late 90's before I left Corporate America for good to do nothing but JPF full time in 97. I also wrote articles and columns in several music publications back then which sadly did little good against the mainstream music industry and their collusion with the corporations. People all over the industry have been screaming about this stuff since Best Buy started the loss leader stuff.

"Why didn't artists ever go ballistic over their physical product being a loss leader. All those under priced CDs at places like Target, Walmart, Best Buy and other non-music stores were all coming out of the writer's/publisher's/artist's pockets too."

Jody, I know you might not realize this but they HAVE been complaining for nearly 30 years. There were 3/4 rates required to get cuts in the first place. There was fuzzy accounting math that came up short for songwriters. They complained continually. When the reduced rates on Wal Mart, Target and Best Buy, came out THEY COMPLAINED TOO. In file sharing and peer to peer and the beginning of all this they were complaining. NSAI started going to Congress every year since 1995 or 96. I went personally in 2006. They have been screaming the entire time because the "public announcements of all these companies, and the big "payouts" they supposedly are making are NOT MAKING IT TO THE SONGWRITERS.

It is the same thing as ENRON, Bernie Madoff and other "Iron Clad" money makers that have been over the years. They make tons of claims while at the same time claiming they don't have enough subscribers, (they still claim to be making no money) and the goal posts get shifted. All of you on that side seem to know something the writers don't know, that all these payouts are being made.

Never once have I heard artists/writers/publishers bitch about the loss leaders until it came to streaming. So its all perspective.

Well I guess this is the problem. Jody, and the "Spotify" side, keep telling everyone that they are being paid, and everything is great. The people who are SUPPOSED to be served are saying "NO IT'S NOT!"

Just like there were many, many, many of us shouting from the rooftops for decades about these problems, and people on your side just said "I don't hear it." I guess that's just the problem like every aspect of our society. Everyone TELLING everyone else how it is, but no one ever LISTENING.

The Intractical problem of current society. If it works for you, great. Hope it keeps going. I continue to see it disappear, but because I expect it, it is not that big a deal. When you see rising tides that will take years to get to you, you build up sea walls, and find other ways to avoid it, just like the Dutch and other people have done throughout centuries. Or you move.

Prove that I've heard artists/writers/publishers bitching about loss leaders. People may have bitched about it - I didn't hear anything specific to loss leaders; record deals, I've heard many people bitch about those, but that's not specific to loss leaders. So yeah, it might be laughable, but I never heard the bitching about loss leaders. You have, and that's your perspective. With your view and Marc's saying it happened, then I can accept that.

Originally Posted by Marc Barnette

Well I guess this is the problem. Jody, and the "Spotify" side, keep telling everyone that they are being paid, and everything is great. The people who are SUPPOSED to be served are saying "NO IT'S NOT!"

I didn't say it was great, I did write it was impressive that Spotify is cash flow positive.

I do believe in streaming and I think it works. I did say I'm getting paid for the streams that happen, and thus I have a different view of streaming. I also said I'm looking at the long term. I get it that in the short term the transition is gonna be painful for some people, especially to those who are used to selling plastic discs.

I really don't get the idea of dikes and how that compares to music. I also don't know what the word Intractical is - couldn't find it in the dictionary.

This is a nice little calculator. It lets you input the number of plays and tells you what you would make with a song on Spotify. In April, 1000 plays on the ad supported service would land you 18 cents, but hold onto your hats - 1000 plays on the premium service would earn you a tidy 60 cents!http://resources.audiam.com/rates/

This is a nice little calculator. It lets you input the number of plays and tells you what you would make with a song on Spotify. In April, 1000 plays on the ad supported service would land you 18 cents, but hold onto your hats - 1000 plays on the premium service would earn you a tidy 60 cents!http://resources.audiam.com/rates/

Hey Gavin!

So a million plays would generate $18,000 - or premium $60,000. And that ain't hay!

This is a nice little calculator. It lets you input the number of plays and tells you what you would make with a song on Spotify. In April, 1000 plays on the ad supported service would land you 18 cents, but hold onto your hats - 1000 plays on the premium service would earn you a tidy 60 cents!http://resources.audiam.com/rates/

That's only for the Mechanical. That doesn't include the Master, the Writer, or the Publisher... The Master is the biggest portion. The Mechanical is one of the smallest portions of a stream's payout.

Right from that website: "The rates are only for the United States and only for 'mechanical' royalties. The rates for sound recordings and the rates in other countries are different."

If you control your music, you can get that Mechanical directly from HFA (Harry Fox) which is who Spotify pays the mechanical thru. Apple Music, Amazon, and others tend to pay the mechanical thru MusicReports.

Humm?, Spotify pay's mechanicals? I thought mechanical royalties are paid on Record Sales. Usually to a Publisher that has publishing and then sent to the songwriter or song writer's as indicated in the publishing contract. What am I missing?

You've thrown in a term regarding the "splits" of the proceeds I did not recognize. Please describe or define "Master" as it applies to the streaming process. While you are at it... can you give us an imaginary example of what a writer or an artist might receive after the money is divvied up on Spotify after 100,000 streams? (Naturally, I'd like to know the amount the other participants receive from this imaginary event.)

Not being picky... I just want to understand which direction the industry appears to be headed. Thanks for mentioning "mechanicals" 'cause this is the first time I've heard of distributions being made for them in the streaming process.